U.S. online spending rose nearly 9% during the 2024 holiday season, with shoppers mainly using their smartphones to buy products ranging from TVs to LEGO sets, data from Adobe Analytics showed on Tuesday.

Holiday spending from November 1 through December 31 rose 8.7% to about $241.4 billion online, compared with Adobe’s forecast of $240.8 billion in September. In 2023, online spending during the same period grew 4.9%.

A shorter holiday season and surplus discounts have been a key feature of the 2024 season with retailers including Walmart and Target increasing spending on ads and offering early discounts, targeted promotions as well as using artificial intelligence to help draw in bargain-hungry customers.

According to Adobe, 54.5% of online shopping transactions took place through a smartphone this holiday season, compared with 51.1% in the same period in 2023.
“The 2024 holiday season showed that e-commerce is being reshaped by a consumer who now prefers to transact on smaller screens and lean on AI-powered services to shop more efficiently,” said Vivek Pandya, lead analyst, Adobe Digital Insights.

Increasing reliance on AI-powered chatbots for product recommendations and shopping assistance drove a 1,300% rise in customer traffic to retail sites, according to Adobe which tracks e-commerce by monitoring online transactions across websites by accessing data from 85% of the top 100 U.S. internet retailers.

Salesforce data also showed that AI-powered chatbots and other shopping features helped consumers purchase and return products during the 2024 holiday season.
Along with convenient shopping and free delivery options, flexible payment methods such as buy-now-pay-later (BNPL) services also grabbed the attention of price-sensitive customers, Adobe said.

For the 2024 holiday shopping, BNPL usage accounted for $18.2 billion in online spend, up 9.6% from the last season.